Hydro Aluminium signs cost-saving relining contract

RELINING: Industrial bricklayers are at work relining the new aluminium reduction cells at Hydro Aluminium Sunndal in Norway.

(Jan. 21, 2004) Hydro Aluminium has contracted Hydro Production Partner Refractory Work to reline the aluminium reduction cells at Hydro's four wholly owned primary aluminium plants in Norway. The total contract is worth around NOK 170 million and represents considerable savings for Hydro Aluminium.

Prior to the start of contract negotiations, Hydro Aluminium had carried out a benchmarking process related to the costs of relining work at the aluminium plants at Karmøy, Høyanger, Årdal and Sunndal, in addition to the metal plant at Neuss in Germany.

The result of the benchmarking showed that it would be possible for the company to reduce its costs by about NOK 8-10 million (EUR 1-1.2 million) per year.

The new three-year contract will continue the business relationship between the companies. Today, Hydro Production Partner Refractory Work is responsible for the relining of the cells at the Norwegian plants.

Hydro Production Partner Refractory Work is an independent business unit within the Hydro Business Partner sector, which offers diverse business services to companies both inside and outside of the Hydro group. The company won the new contract with Hydro Aluminium in competition with external bidders.

"Active benchmarking has been a learning opportunity for all participants," points out Thorvald Mellerud, who is head of the Hydro Aluminium business unit Primary Aluminium Production.